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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of report (Date of earliest event reported): October 21, 2004
Willis Group Holdings Limited
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(Exact Name of Registrant as Specified in Its Charter)
Bermuda
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(State or Other Jurisdiction of Incorporation)
001-16503 98-0352587
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(Commission File Number) (IRS Employer Identification No.)
Ten Trinity Square
London EC3P 3AX, England
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(Address of Principal Executive Offices)
(44) (20) 7488-8111
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(Registrant's Telephone Number, Including Area Code)
Not Applicable
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(Former Name or Former Address, if Changed Since Last Report)
Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions (see General Instruction A.2. below):
|_| Written communications pursuant to Rule 425 under the Securities Act (17
CFR 230.425)
|_| Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
|_| Pre-commencement communications pursuant to Rule 14d-2(b) under the
Exchange Act (17 CFR 240.14d-2(b))
|_| Pre-commencement communications pursuant to Rule 13e-4(c) under the
Exchange Act (17 CFR 240.13e-4(c))
Item 8.01. Other Events.
On October 21, 2004, Willis Group Holdings Limited ("WGHL") issued a press
release (the "Press Release") announcing that it is ending the practice of
accepting contingency payments from insurers. A copy of the Press Release is
attached as Exhibit 99.1 to this Report on Form 8-K and is incorporated herein
by reference.
Item 9.01. Financial Statements and Exhibits.
(c) Exhibits.
99.1 Press Release of WGHL dated October 21, 2004
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
WILLIS GROUP HOLDINGS LIMITED
Date: October 27, 2004 By: /s/ William P. Bowden, Jr.
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Name: William P. Bowden, Jr.
Title: General Counsel
EXHIBIT INDEX
Exhibit No. Description
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99.1 Press Release of WGHL dated October 21, 2004
Exhibit 99.1
Willis Group Holdings To End Practice of Contingency Agreements with Insurance
Carriers
NEW YORK--(BUSINESS WIRE)--Oct. 21, 2004--Willis Group Holdings (NYSE:
WSH):
-- Company Takes Action in Response to Customer Concerns over Contingents
-- Company Finds No Evidence that Practices of Bid-Rigging Have Occurred
at Willis
-- Willis Introduces "Client Bill of Rights" Formalizing Its Commitment
to Client Advocacy
Willis Group Holdings (NYSE: WSH), the global insurance broker, today
announced that it is ending the practice of accepting contingency payments from
insurers. The company also said that an internal review of practices conducted
in the course of responding to subpoenas received from the New York Attorney
General had found no evidence that the practices of bid-rigging or "tying"
placements with insurers to sales of treaty reinsurance services have been
engaged in at Willis.
The company also today introduced a new Client Bill of Rights, articulating
the company's commitment to client advocacy.
Joe Plumeri, Chairman and Chief Executive Officer of Willis Group Holdings,
said, "Willis is committed to client advocacy, which means listening to our
clients. We want our clients to know that we have heard them loud and clear:
they don't like contingency agreements. We are abolishing contingencies at
Willis in response to client concerns. We believe this will strengthen our
relationships with clients and remove even the appearance of a conflict of
interest. We also are spelling out for clients our commitment to them in our
Client Bill of Rights and creating new ways for them to ensure we hear their
concerns."
The company said it will discontinue contingency agreements in North
America immediately. Willis also said it would discontinue contingency
agreements in the other countries in which it operates around the world, with
the intention of having all existing contingency agreements in markets outside
North America unwound as soon as possible and in any event by the end of the
year.
The company said that, on a global basis, market agreements had been
expected to generate about $160 million in revenue for 2004. Of this amount,
about $35 million was from North America in 2004 and the rest from other markets
around the world.
Estimated 2004 Global Insurer Services Compensation
Definitions of Contingent Commissions vary. In the interest of clarity, we
are giving below a broad summary of the various forms of compensation we receive
from the market. This includes a number of items which fall outside our normal
definition of volume and profit contingencies. The figures are based on our
assessment of the income that would normally have been earned on our agreements
and best estimates of 2004 premium volume.
US $m
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Global Volume Contingencies (Distribution Services Compensation
driven primarily by premium Volume transacted with carriers). 73
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Global Profit Contingencies (Distribution Services Compensation
driven primarily by the profit performance of business transacted
with carriers). 7
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Market Service Fees (Compensation paid for Product Development
Services, Carrier Benchmarking and Underwriting Analysis, Market
Research, Industry and Geographic Intelligence, Modelling, Policy
Issuance and Premium Accounting, Claims Management and Processing
etc). 42
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Miscellaneous Items (Line Slip and Cover Holder Management,
Binding Authorities, Underwriting and Administration services,
Portfolio Management, Market Security Information, Credit Finance
etc). 38
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Worldwide Total 160
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To underscore our commitment to our clients, we are introducing a Client
Bill of Rights. This articulates our commitment to assuring that our practices
uphold the highest standard of fairness and integrity.
The Client Bill of Rights include the following fundamental commitments:
1. Willis represents the client's best interests through a Client Advocate.
Willis' global resources and services are committed to understanding the
client's company, its industry and its individual needs. Willis' recommendations
and solutions will be driven by what is in the client's best interests. This is
the centerpiece of the value Willis provides its clients.
2. At the commencement of every new engagement and at renewal thereafter
Willis will describe the service and value it provides and how it is compensated
for it - in plain and simple language as part of its terms of business
agreement.
3. Willis will listen before it acts. Its partnerships with clients will be
typified by clear, complete and candid communication.
4. Clients will have a toll-free number to give Willis feedback on the
quality of its services. Clients can comment, critique and suggest areas for
improvement. Willis values client input.
5. Willis will require that the training all of its Associates already
receive includes enhanced emphasis on their duty of care, undivided loyalty and
full disclosure to clients.
6. Willis Associates are prohibited from accepting any gifts, entertainment
or trips from insurers that could create the appearance of a conflict of
interest with its clients.
7. Willis will not accept contingency compensation.
8. We will conduct our business in accordance with our "best practices"
guidelines we refer to as the Willis Excellence Model.
9. Willis' compliance with these principles will be monitored by a series
of internal controls, including regular compliance reviews, audits and review by
the Audit Committee of the Willis Board of Directors.
"Our basic principle and guiding philosophy is that we represent our
clients. We're going to do business based on what's best for our clients, and we
believe that will also be best for our Associates and our shareholders," Mr.
Plumeri said.
Willis Group Holdings Limited is a leading global insurance broker,
developing and delivering professional insurance, reinsurance, risk management,
financial and human resource consulting and actuarial services to corporations,
public entities and institutions around the world. With over 300 offices in some
80 countries, its global team of 14,500 Associates serves clients in some 180
countries. Additional information on Willis may be found on its web site
www.willis.com.
This press release may contain certain statements relating to future
results, which are forward-looking statements as that term is defined in the
Private Securities Litigation Reform Act of 1995. These forward-looking
statements are subject to certain risks and uncertainties that could cause
actual results to differ materially from historical results or those
anticipated, depending on a variety of factors such as general economic
conditions in different countries around the world, fluctuations in global
equity and fixed income markets, changes in premium rates, the competitive
environment and the actual cost of resolution of contingent liabilities. Further
information concerning the Company and its business, including factors that
potentially could materially affect the Company's financial results are
contained in the Company's filings with the Securities and Exchange Commission.
CONTACT: Willis Group Holdings
Investors:
Kerry K. Calaiaro
+1-212-837-0880
Email: calaiaroke@willis.com
or
Media:
Nicholas Jones
+ 44 20 7488-8190
Email: jonesnr@willis.com
or
Dan Prince
+1-212-837-0806
Email: princeda@willis.com